Poor remittance: Ikeja, Abuja, 6 other DisCos face new sanction

Poor remittance: Ikeja, Abuja, 6 other DisCos face new sanction

- The Nigerian Electricity Regulatory Commission has threatened to sanction 8 DisCos

- The DisCos were said to have breached the provisions of the electric power sector reform act

- Ikeja, Abuja, Enugu and five others would be affected

Nigerian cities may experience serious power outage if the threat by the Nigerian Electricity Regulatory Commission (NERC) becomes a reality.

Business Day reports that the NERC said it would cancel licenses of eight power Distribution Companies (DisCos) for failure to meet their obligated remittance to the market.

Legit.ng gathered that the government agency said that it was convinced that DisCos breached the provisions of the electric power sector reform act.

It said: “The commission has reasonable cause to believe that the DisCos listed below have breached the provisions of the electric power sector reform act, terms and conditions of their respective distribution licences and the 2016 – 2018 Minor Review of the Multi Year Tariff Order (MYTO) and minor remittance order for the year 2019.”

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According to the regulator, the affected DisCos include the Abuja electricity distribution company Plc, Benin electricity distribution company Plc, Enugu electricity distribution company Plc and Ikeja electric Plc.

Others are Kaduna electricity distribution company Plc, Kano electricity distribution company Plc, Port Harcourt electricity distribution company Plc and Yola electricity distribution company Plc.

It would be recalled that NERC had only two months ago published a minor review of electricity tariff which was meant to address shortfalls caused by lack of non-reflective tariff but provided a minimum remittance threshold DisCos must meet by July 2019.

The increased tariff which takes effect from January 1, 2020 prescribes at least 30 percent rise in tariff across the various customer classes.

DisCos were required to meet their obligation to the market, improve collections by metering customers especially government ministries and departments and payback loans from the Central Bank.

The regulator, however, said that the DisCos, despite exacting a favourable tariff review from it, failed to meet its own end of the bargain by remitting more of what it collected to other players across the value chain.

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The NERC has been accused of failing to wield the hammer in the face of bad behaviour of operators especially the DisCos, adding that with the new order, the regulator may be serving notice to the DisCos that it is no longer going to tolerate market indiscipline.

Meanwhile, Legit.ng had previously reported that Nigerian cities may face massive darkness with an imminent shutdown of 24 thermal powers by some Generation Companies (GenCos) over the introduction of a controversial charge.

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Source: Legit

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